Greenback perched to go to hell in a hand basket...as GOLD SOARS
(8x8--) Apr 07, 16:12
The Weekly US Dollar chart paints an accident about to happen. From all TA angles it is about to take a big fall.
The MACD has been heading lower for some time. In fact it demonstrates overt negative divergence to price. Always a early
bird sign heralding a decline.
The 2 moving averages just crossed downward. The last two time this occurred, the $ Index forthwith plummeted 7 whole
points.
Slow stochastices peaked and are heading bearishly south.
But the most menacingly bearish aspect of the greenback portrait is the large H&S Top which has just finished creating the
right shoulder - and is heading for the neckline at 114. Once the neckline is violated, the measuring rule projects a
downside of plus/minus 103, where there is substantial support. In this event it means a greenback fall on the order of 12%
from Friday's close of 117 and change.
stockcharts.com[l,a]wahlynay[df][pb13!b5][iUa12,26,9!Lh14,3]&pref=G
Since this is a weekly chart, reliabilty is high that the US buck is headed for a substantial collapse - nearly always bullish
for the shiny yellow. And since gold recently has demonstrated a strong upward bias, I venture to say a 12% hit sustained
by the dollar will be matched by a 12% homerun by the shiny yellow. Therefore, I am looking for $337/oz as an
intermediate term goal.
GOLD PAINTS THE EXACT OPPOSITE PICTURE
Not surprisingly we see gold's weekly price charting a course 180% from the good ship USS BUCK (for all landlubbers that
means in the exact opposite direction).
All the aforementioned TA indicators are bullishly rising. Moreover, the Upside-down H&S forecasts substantially higher
values for gold going forward. The MAIN neckline at about 294 was successfully penetrated a few weeks back. To note
there was a not too uncommon pullback to test the neckline. Upon Successfully testing it, gold began to advance again.
The reverse H&S formation calls for a price goal of 332, which jives well with the 337 gold call based on the US dollar TA
above.
It is axiomatic to point out that preious metal stocks will soar as gold seeks its projected price target of 332-337. However,
before reaching its designated target, gold may pause momentarily at slight resistance in the 320/322 area.
Time horizon?
I would guess by the first day of summer (06/20/02). That said, I caution all to be already on board because of potetially
explosive armed belligerence in areas of the world: Middle-East (Israel vs Arabs); Asia (China vs Japa & China vs Taiwan);
and USA vs Iraq and/or Iran. A shooting flareup of conflict in any one of these theaters of operation would cause the shiny
yellow to go ballistic. In such an event we might see gold up limit ($50/day) 2-3 days back-to-back. And as everyone
knows, NO ONE can take a NEW position in LIMIT UP DAYS. Fortunes will be made...and lost in less than a week! |
